Latest Expert Exchange Queries
sitemapHome | Registration | Job Portal for CA's | Expert Exchange | Currency Converter | Post Matrimonial Ads | Post Property Ads
 
 
News shortcuts: From the Courts | News Headlines | VAT (Value Added Tax) | Service Tax | Sales Tax | Placements & Empanelment | Various Acts & Rules | Latest Circulars | New Forms | Forex | Auditing | Direct Tax | Customs and Excise | ICAI | Corporate Law | Markets | Students | General | Indirect Tax | Mergers and Acquisitions | Continuing Prof. Edu. | Budget Extravaganza | Transfer Pricing
 
 
 
 
Popular Search: VAT RATES :: TDS :: articles on VAT and GST in India :: cpt :: empanelment :: ICAI offer Get Windows 7,Office 2010 in Rs.799 Taxes :: ARTICLES ON INPUT TAX CREDIT IN VAT :: list of goods taxed at 4% :: Central Excise rule to resale the machines to a new company :: ACCOUNTING STANDARDS :: VAT Audit :: due date for vat payment :: form 3cd :: ACCOUNTING STANDARD :: TAX RATES - GOODS TAXABLE @ 4%
 
 
« News Headlines »
 Filing Income Tax Returns? Things To Keep In Mind As Deadline Approaches
 Filing of online return for 4th quarter of 2016-17- extension of period thereof.
 New tax accounting standards may reduce leeway for infrastructure companies
 GST – CONCEPT & STATUS – As on 01st May, 2017
 Govt extends VAT deadline, relief for developers
 Income Tax Appellate Tribunal Rules, 2017
 Got your Form 16? You should file income tax returns early to enjoy benefits
 Want to save tax? Here are 6 best investment options for you
 Income Tax department activates e-filing facility for all ITRs
 All the income-tax return forms for the current assessment year are available online
 New GST – CONCEPT & STATUS – As on 01st May, 2017

Insurers face tax axe, policy cost likely to rise
August, 24th 2006
Service tax has come back to haunt life insurance companies. The Central Board of Excise and Customs has said that insurance companies should pay service tax for providing asset management services. An imposition of service tax on asset management would either increase charges for policyholders or add to the life insurers losses. The Central Board of Excise and Customs has said that insurance companies should pay service tax for providing asset management services. For insurance companies, the bigger problem is that of changing their systems. Insurers have already had to change their systems twice. The first time was when service tax was applied on life premium, and the second time was when Ulip guidelines were revised. The tax authority has asked several Mumbai-based life insurance companies the extent of their income from asset management. Some companies have taken the stand that the charges levied on policyholders are not asset management charges. The department, in turn, has told them to sign a declaration that no asset management charges are being levied. Private life insurers manage close to Rs 20,000 crore mobilised through sale of unit-linked insurance policies. The fees on this range vary from a low of 0.5% for group retirement benefit plans to just below 2%, depending on the type of scheme. Mutual funds pay service tax on the asset management fees that they receive. Insurance companies pay service tax only on the risk premium the charges levied for providing life cover. Service tax on life insurance premium was first proposed by then finance minister Yashwant Sinha four years ago. It was later fully withdrawn by Jaswant Singh when he was the finance minister, only to be reintroduced on risk premium. Fund management or administration charges are more relevant to unit-linked insurance. In traditional policies, there is no asset management charge as all the premium goes into a central life fund. All charges are deducted from the life fund and any surplus is distributed to policyholders in the form of dividend or bonus. For insurance companies, the bigger problem is that of changing their systems. If the service tax is to be passed on to the policyholder, it has to first figure out the value of his holding. Since this can be ascertained only after he pays the premium, the tax can be collected through cancellation of units. Insurers have already had to change their systems twice. The first time was when service tax was applied on life premium, and the second time was when Ulip guidelines were revised.
 
 
Home | About Us | Terms and Conditions | Contact Us
Copyright 2017 CAinINDIA All Right Reserved.
Designed and Developed by Binarysoft Technologies Pvt. Ltd.
Custom Software Development Outsourcing Custom Software Development Offshore Cus

Transfer Pricing | International Taxation | Business Consulting | Corporate Compliance and Consulting | Assurance and Risk Advisory | Indirect Taxes | Direct Taxes | Transaction Advisory | Regular Compliance and Reporting | Tax Assessments | International Taxation Advisory | Capital Structuring | Withholding tax advisory | Expatriate Tax Reporting | Litigation | Badges | Club Badges | Seals | Military Insignias | Emblems | Family Crest | Software Development India | Software Development Company | SEO Company | Web Application Development | MLM Software | MLM Solutions